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Housing association gets A+ credit rating despite tower block costs
Plymouth Community Homes (PCH) has received an A+ credit rating despite a fall in margins after it spent £12m making its tower blocks safe.
This puts the 16,000-home housing association near the top of the social housing sector in terms of credit ratings.
In a judgement, ratings agency Standard & Poor’s (S&P) said that PCH “demonstrates strong expertise and financial profiles, driven by solid operational performance, low levels of debt and robust liquidity”.
The rating, it said, was issued despite PCH spending £12m on “tower block upgrades”, which caused its margins to fall.
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Inside Housing reported in April last year that PCH believed it would be unable to meet the costs of removing dangerous cladding without knock-on effects to its new build and refurbishment programmes.
Shortly after that, in May last year, the government announced that it would fully fund the removal and replacement of dangerous cladding on social housing tower blocks.
PCH said that it had spent £14m of this money on re-cladding Mount Wise Towers, a development found to have the same kind of cladding as Grenfell Tower, where a deadly fire killed 72 people in 2017.
As well as replacing the cladding, PCH has installed sprinklers throughout the three tower blocks, for which the government provided no funds.
Nick Jackson, director of business services and development, said: “Receiving an A+ credit rating demonstrates our financial security to all those with an interest in PCH and is a good rating in the housing association sector.
“We have worked continuously over the years to retain our social values while being more commercial in our business activities. This has enabled us to reduce costs, generate income and improve our overall financial position through refinancing, allowing us to invest more in our homes and neighbourhoods across Plymouth.”
Last month, the Regulator of Social Housing upgraded PCH’s rating for financial viability from V2 to V1, the highest possible rating.
